HDSRF Funding to Address Environmental Impacts

15 Jul HDSRF Funding to Address Environmental Impacts

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Sometimes, municipalities, businesses, and individuals must address environmental impacts they may or may not have created. Environmental investigation and remediation costs are often unanticipated and expensive. If funding to address the impacts is unavailable, communities may become blighted, development projects may halt, or property owners may neglect their environmental responsibilities, putting themselves at risk of penalties. Failure to address these issues will eventually result in the involvement of the New Jersey Department of Environmental Protection (NJDEP), bringing fines, environmental compliance costs (they truly are inevitable), and possibly legal fees. To protect the environment, foster environmental compliance, and spur economic growth, the NJDEP and New Jersey Economic Development Authority (EDA) established the Hazardous Discharge Site Remediation Fund (HDSRF). The HDSRF is a funding source available to individuals, municipalities, and businesses to finance certain environmental services for impacted sites. Financing can take the form of either a loan or a grant, dependent upon the circumstances and net worth of the person/institution.

Who is Eligible for Funding?

Funding is available for both private and public entities. However, the nature of those funds and their eligibility vary.

Private Funding

NJDEP restricts HDSRF funding, especially grants, to those most in need. Here is an abbreviated list of qualifying criteria:

1. Property purchased prior to 12/31/83 where a discharge occurred unrelated to the operations of those conducted by the individual who acquired the site.
2. Individuals and businesses who qualify for the program must have a financial net worth of less than $2 million.
3. Private entities must have discharged a hazardous substance or be responsible for such hazardous substances. In addition, to be eligible, there can be no other remedial funding source. When insurance coverage is available, the claimant must agree to direct insurance funds back to the New Jersey Treasury.

Child Care Facility Grants

Child Care Facility Grants are available for existing and prospective licensed childcare facilities. HDSRF funding qualifying criteria includes:

1. Individuals or businesses seeking funding must be licensed or seeking licensure as a childcare facility.
2. Funding must be used to complete a Preliminary Assessment Report.  

Public Funding

Municipalities seeking to utilize HDSRF funding may be eligible, provided they meet the following qualifying criteria:

1. They own or hold a tax sale certificate on the property
2. They have a comprehensive plan or realistic opportunity for the property to be redeveloped within a three-year period.

What Are the Funding Sources Available?

During the application process, applicants will elect to either apply for grants or loans. Whether an individual receives a grant or loan is determined by the NJDEP and EDA and the type of funding requested. Funding source category uses include:

1.  Affordable Housing Grants
2.  Public Entity Preliminary Assessments, Site Investigations, and Remedial Investigation Grants
3.  Recreation & Conservation Grants

How Much Funding Is Available and What Can It Be Used For?

The total amount of funds available for dispersal to public and private entities from the NJDEP and NJEDA is dependent upon the amount of funds allocated to the HDSRF for that fiscal year. In an ideal situation, funding caps for a calendar year would be as follows:

Private Entities: Individuals or Businesses can borrow up to $1 million per calendar year to perform environmental remediation of a known or suspected contaminant. Matching Grants may be awarded to the entity for the use of innovative technology or attain unrestricted or limited site restriction use.

Childcare Facilities: If awarded, the facility will be granted a maximum of $1,500 dollars towards the completion of a Preliminary Assessment Report.

Public Entities: Public entities may receive grants and/or loans for preliminary assessments, site investigations, and remedial investigations, with a maximum allowance of $2 million per calendar year. It is important to note that grants will cover only 75% of remedial action cost under certain conditions.

HDSRF funding is site specific and can be complex. This article is a general overview of the types of funding that that can be employed by public, private, and non-profit entities. For a more comprehensive list of HDSRF loans and grants, click here, or call ESA Environmental Consultants at 732.469.8888 for more information on how you may be able to leverage the funds available through the HDSRF. And finally, see our previous article entitled “Other People’s Money” for more funding sources that may be available to cover your remediation costs.